Automated Labs uses 5 workers and 200 machines to produce its product. The marginal product of the last workers is 200 units of output per day; the marginal product of the last machine is 400 units of output per day. Workers are each paid $100 per day, and the rental price of each machine is $300 per day. a. What is the marginal product per dollar spent on a worker? b. What is the marginal product per dollar spent on a machine? Is Automated Labs utilizing workers and machines in the cost-minimizing manner? What should it to minimize its costs? Explain. C.

ECON MICRO
5th Edition
ISBN:9781337000536
Author:William A. McEachern
Publisher:William A. McEachern
Chapter7: Production And Cost In The Firm
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Automated Labs uses 5 workers and 200 machines to produce its product. The marginal product of the last workers is 200 units
of output per day; the marginal product of the last machine is 400 units of output per day. Workers are each paid $100 per day,
and the rental price of each machine is $300 per day.
а.
What is the marginal product per dollar spent on a worker?
b.
What is the marginal product per dollar spent on a machine?
Is Automated Labs utilizing workers and machines in the cost-minimizing manner? What should it to minimize its costs?
C.
Explain.
Transcribed Image Text:Automated Labs uses 5 workers and 200 machines to produce its product. The marginal product of the last workers is 200 units of output per day; the marginal product of the last machine is 400 units of output per day. Workers are each paid $100 per day, and the rental price of each machine is $300 per day. а. What is the marginal product per dollar spent on a worker? b. What is the marginal product per dollar spent on a machine? Is Automated Labs utilizing workers and machines in the cost-minimizing manner? What should it to minimize its costs? C. Explain.
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